Author Topic: an argument for a deflationary policy in the You Ess of Heeeeey  (Read 38523 times)

Disco Pickle

  • The Complaint Department is around back.
  • Deserved It
  • ****
  • Posts: 2639
  • Shy and Retiring Love Barbarian of the Apocalypse
    • View Profile
an argument for a deflationary policy in the You Ess of Heeeeey
« on: September 06, 2010, 07:57:12 pm »
This needs polishing as an idea and I'm aware of that, so I'm posting it here among you free thinkers in order to get some feed back and holes blown in it, so I can do more research and patch them where I can.

I've had thoughts like this in my head for the last few years, but never put any of them down, and this was written in an entirely different thread discussing a method of reducing the costs necessary to fund social security for the baby boomers.  

So here it is, in all it's roughness.

what I mean by controlled deflation is this:  

After whatever recovery from this recession we will have, the inflation inherent in the system that pumped trillions of dollars in will begin to manifest in the sorts of conditions that existed in the 70's..  except there will not likely be as many people demanding higher wages, as there will not be as many people working.  Stagflation of the economy, while always a potential risk, will likely only be garden variety high inflation, while wages stay stagnant.  

The Fed will have to raise interest rates, like Volker did in the 80's, to rein in the money supply.  The cost of borrowing will go up, while encouraging more savings as interest rates rise.  This should be sustained as reasonably as possible, allowing the prices of goods, property, etc to come down to levels that resemble reality based on the prevailing wage and people's ability to borrow against their own collateral and savings.  

Combine this with a push to buy up a large amount of our own countries reserves being held in foreign banks and return them to this country as collateral, reducing our debt pile, including buying a significant amount of China's Silver reserves (assuming they're still on the market) and giving this country a firm financial base on which to stand, maybe for the first time in decades.

There will be pain for some.  That cannot be discounted.  but the alternative is to continue to push off a real recovery on the next generation, when recession after recession, it becomes clear that they get worse and worse without addressing the fundamental problems in the money supply as it relates to real wages and savings rates.

We cannot compete in the global market with countries like china and Mexico providing much lower labor costs, without trying to bring our own cost of labor down.  The only rational way to do that is to lower prices in a controlled manner and allow wages to fall behind them.  If Inflation has always out paced wages, then the rational push to be competitive is to let wages follow deflation of the dollar.

The concept of "Standard of Living" is based on the inflation in the system, since there's no longer a rational basis for the value of the dollar other than the collective delusion of the people using it.  Use this to everyones' advantage and bring our "price to wage" ration back to normal levels.
Events in the past may be roughly divided into those which probably never happened and those which do not matter. --William Ralph Inge

"sometimes someone confesses a sin in order to take credit for it." -- John Von Neumann

Kai

  • A flea circus and
  • Deserved It
  • ****
  • Posts: 8917
  • Richard Feynman fangirl.
    • View Profile
Re: an argument for a deflationary policy in the You Ess of Heeeeey
« Reply #1 on: September 06, 2010, 08:00:48 pm »
 :lulz: :lulz: :lulz:

 :lulz:
If there is magic on this planet, it is contained in water. --Loren Eisley, The Immense Journey

Her Royal Majesty's Chief of Insect Genitalia Dissection
Grand Visser of the Six Legged Class
Chanticleer of the Holometabola Clade Church, Diptera Parish

Phox

  • Deserved It
  • ****
  • Posts: 7100
    • View Profile
Re: an argument for a deflationary policy in the You Ess of Heeeeey
« Reply #2 on: September 06, 2010, 08:03:54 pm »
:lulz: :lulz: :lulz:

 :lulz:

This. But a helpful hint. Problem 1: People living beyond their means make up a large portion of the population. What do you tihnk is going to happen to them in your system?

Disco Pickle

  • The Complaint Department is around back.
  • Deserved It
  • ****
  • Posts: 2639
  • Shy and Retiring Love Barbarian of the Apocalypse
    • View Profile
Re: an argument for a deflationary policy in the You Ess of Heeeeey
« Reply #3 on: September 06, 2010, 08:05:52 pm »
:lulz: :lulz: :lulz:

 :lulz:

Thnx for contributing to the discussion Kai.

you're a credit to you're university.
:lulz: :lulz: :lulz:

 :lulz:

This. But a helpful hint. Problem 1: People living beyond their means make up a large portion of the population. What do you tihnk is going to happen to them in your system?

They're going to have to start thinking rationally about their finances, or fail.  as they should.  Those of us who live within our means should not have to suffer for the ones who do not.
Events in the past may be roughly divided into those which probably never happened and those which do not matter. --William Ralph Inge

"sometimes someone confesses a sin in order to take credit for it." -- John Von Neumann

Phox

  • Deserved It
  • ****
  • Posts: 7100
    • View Profile
Re: an argument for a deflationary policy in the You Ess of Heeeeey
« Reply #4 on: September 06, 2010, 08:08:42 pm »
 :lulz:

Disco Pickle

  • The Complaint Department is around back.
  • Deserved It
  • ****
  • Posts: 2639
  • Shy and Retiring Love Barbarian of the Apocalypse
    • View Profile
Re: an argument for a deflationary policy in the You Ess of Heeeeey
« Reply #5 on: September 06, 2010, 08:09:45 pm »
:lulz: :lulz: :lulz:

 :lulz:

Thnx for contributing to the discussion Kai.

you're a credit to you're university.
:lulz: :lulz: :lulz:

 :lulz:

This. But a helpful hint. Problem 1: People living beyond their means make up a large portion of the population. What do you tihnk is going to happen to them in your system?

They're going to have to start thinking rationally about their finances, or fail.  as they should.  Those of us who live within our means should not have to suffer for the ones who do not.


oh, and in a reality where you have to actually have collateral to live beyond your means, or risk loosing it, it's more and more not an option.

our grandparents lived this way.  10% down on a house before you could buy it.

we've strayed from reality, where you can buy a house with nothing but a promise.

that era is dead.  and thankfully.
Events in the past may be roughly divided into those which probably never happened and those which do not matter. --William Ralph Inge

"sometimes someone confesses a sin in order to take credit for it." -- John Von Neumann

Phox

  • Deserved It
  • ****
  • Posts: 7100
    • View Profile
Re: an argument for a deflationary policy in the You Ess of Heeeeey
« Reply #6 on: September 06, 2010, 08:16:47 pm »


They're going to have to start thinking rationally about their finances, or fail.  as they should.  Those of us who live within our means should not have to suffer for the ones who do not.


oh, and in a reality where you have to actually have collateral to live beyond your means, or risk loosing it, it's more and more not an option.

our grandparents lived this way.  10% down on a house before you could buy it.

we've strayed from reality, where you can buy a house with nothing but a promise.

that era is dead.  and thankfully.

THIS is why I love Libertarian economics.  :lulz: :lulz: :lulz: :lulz: :lulz: :lulz:

Disco Pickle

  • The Complaint Department is around back.
  • Deserved It
  • ****
  • Posts: 2639
  • Shy and Retiring Love Barbarian of the Apocalypse
    • View Profile
Re: an argument for a deflationary policy in the You Ess of Heeeeey
« Reply #7 on: September 06, 2010, 08:18:59 pm »
:lulz:


LAWL questions I answer while providing no rational rebuttal.

I am slowly starting to realize that this board is not actually interested in discussing issues, only ridiculing ones they think they do not agree with, while providing nothing in the way or rational response to ones they do not agree with.

that wouldn't jive with discordianism, after all..  because chaos can exist without the order that's already inherent in the world in which we already live and have to function.

anarchy is nice in theory, until you have to live in it.
Events in the past may be roughly divided into those which probably never happened and those which do not matter. --William Ralph Inge

"sometimes someone confesses a sin in order to take credit for it." -- John Von Neumann

Phox

  • Deserved It
  • ****
  • Posts: 7100
    • View Profile
Re: an argument for a deflationary policy in the You Ess of Heeeeey
« Reply #8 on: September 06, 2010, 08:23:32 pm »
:lulz:


LAWL questions I answer while providing no rational rebuttal.

I am slowly starting to realize that this board is not actually interested in discussing issues, only ridiculing ones they think they do not agree with, while providing nothing in the way or rational response to ones they do not agree with.

that wouldn't jive with discordianism, after all..  because chaos can exist without the order that's already inherent in the world in which we already live and have to function.

anarchy is nice in theory, until you have to live in it.

 :roll:

What you are suggesting will cause as much pain and suffering as full on descent into absolute anarchy, only all at once. If you can't see the flaws in your own argument, then there is really no point in having us point them out to you, since you will do what you just did a second ago.

Disco Pickle

  • The Complaint Department is around back.
  • Deserved It
  • ****
  • Posts: 2639
  • Shy and Retiring Love Barbarian of the Apocalypse
    • View Profile
Re: an argument for a deflationary policy in the You Ess of Heeeeey
« Reply #9 on: September 06, 2010, 08:28:16 pm »
:lulz:


LAWL questions I answer while providing no rational rebuttal.

I am slowly starting to realize that this board is not actually interested in discussing issues, only ridiculing ones they think they do not agree with, while providing nothing in the way or rational response to ones they do not agree with.

that wouldn't jive with discordianism, after all..  because chaos can exist without the order that's already inherent in the world in which we already live and have to function.

anarchy is nice in theory, until you have to live in it.

 :roll:

What you are suggesting will cause as much pain and suffering as full on descent into absolute anarchy, only all at once. If you can't see the flaws in your own argument, then there is really no point in having us point them out to you, since you will do what you just did a second ago.

and that jives with your sense of discord..  how?

at least my proposal, while admittedly rough, aprovides a reboot of sorts, allowing for and even *gasp* encouraging self education on all things finance.

you've still offered nothing to this thread, except ridicule with no ideas. 

maybe I really am on the wrong board.

I clearly asked for
Quote
holes blown in it, so I can do more research and patch them where I can.

Maybe you're just lazy fucks who aren;t actually interested in answers..  maybe you're "REAL DISCORDIANS"

I expect much lulz out of that last one.

Events in the past may be roughly divided into those which probably never happened and those which do not matter. --William Ralph Inge

"sometimes someone confesses a sin in order to take credit for it." -- John Von Neumann

Thurnez Isa

  • Director of the Church of Pornography and Jesus
  • Deserved It
  • ****
  • Posts: 7524
  • SCREAMING PRIMATE
    • View Profile
Re: an argument for a deflationary policy in the You Ess of Heeeeey
« Reply #10 on: September 06, 2010, 08:29:05 pm »
:lulz:


LAWL questions I answer while providing no rational rebuttal.

I am slowly starting to realize that this board is not actually interested in discussing issues, only ridiculing ones they think they do not agree with, while providing nothing in the way or rational response to ones they do not agree with.

that wouldn't jive with discordianism, after all..  because chaos can exist without the order that's already inherent in the world in which we already live and have to function.

anarchy is nice in theory, until you have to live in it.

Too busy to comment right now, but
Im not an anarchist, please don't suggest I am
Through me the way to the city of woe, Through me the way to everlasting pain, Through me the way among the lost.
Justice moved my maker on high.
Divine power made me, Wisdom supreme, and Primal love.
Before me nothing was but things eternal, and eternal I endure.
Abandon all hope, you who enter here.

Dante

Adios

  • Deserved It
  • ****
  • Posts: 11707
    • View Profile
Re: an argument for a deflationary policy in the You Ess of Heeeeey
« Reply #11 on: September 06, 2010, 08:32:00 pm »
:lulz:


LAWL questions I answer while providing no rational rebuttal.

I am slowly starting to realize that this board is not actually interested in discussing issues, only ridiculing ones they think they do not agree with, while providing nothing in the way or rational response to ones they do not agree with.

that wouldn't jive with discordianism, after all..  because chaos can exist without the order that's already inherent in the world in which we already live and have to function.

anarchy is nice in theory, until you have to live in it.

 :roll:

What you are suggesting will cause as much pain and suffering as full on descent into absolute anarchy, only all at once. If you can't see the flaws in your own argument, then there is really no point in having us point them out to you, since you will do what you just did a second ago.

and that jives with your sense of discord..  how?

at least my proposal, while admittedly rough, aprovides a reboot of sorts, allowing for and even *gasp* encouraging self education on all things finance.

you've still offered nothing to this thread, except ridicule with no ideas. 

maybe I really am on the wrong board.

I clearly asked for
Quote
holes blown in it, so I can do more research and patch them where I can.

Maybe you're just lazy fucks who aren;t actually interested in answers..  maybe you're "REAL DISCORDIANS"

I expect much lulz out of that last one.



I am beginning to suspect you are just trolling. Your entire concept is a hole.

Phox

  • Deserved It
  • ****
  • Posts: 7100
    • View Profile
Re: an argument for a deflationary policy in the You Ess of Heeeeey
« Reply #12 on: September 06, 2010, 08:33:01 pm »
:lulz:


LAWL questions I answer while providing no rational rebuttal.

I am slowly starting to realize that this board is not actually interested in discussing issues, only ridiculing ones they think they do not agree with, while providing nothing in the way or rational response to ones they do not agree with.

that wouldn't jive with discordianism, after all..  because chaos can exist without the order that's already inherent in the world in which we already live and have to function.

anarchy is nice in theory, until you have to live in it.

 :roll:

What you are suggesting will cause as much pain and suffering as full on descent into absolute anarchy, only all at once. If you can't see the flaws in your own argument, then there is really no point in having us point them out to you, since you will do what you just did a second ago.

and that jives with your sense of discord..  how?

at least my proposal, while admittedly rough, aprovides a reboot of sorts, allowing for and even *gasp* encouraging self education on all things finance.

you've still offered nothing to this thread, except ridicule with no ideas. 

maybe I really am on the wrong board.

I clearly asked for
Quote
holes blown in it, so I can do more research and patch them where I can.

Maybe you're just lazy fucks who aren;t actually interested in answers..  maybe you're "REAL DISCORDIANS"

I expect much lulz out of that last one.



You want an alternative answer? Free-market capitalism has to go. A new economic model replaces it. It works as well as your suggestion, and is just as easy to implement. And much less wordy.

Disco Pickle

  • The Complaint Department is around back.
  • Deserved It
  • ****
  • Posts: 2639
  • Shy and Retiring Love Barbarian of the Apocalypse
    • View Profile
Re: an argument for a deflationary policy in the You Ess of Heeeeey
« Reply #13 on: September 06, 2010, 08:34:53 pm »
:lulz:


LAWL questions I answer while providing no rational rebuttal.

I am slowly starting to realize that this board is not actually interested in discussing issues, only ridiculing ones they think they do not agree with, while providing nothing in the way or rational response to ones they do not agree with.

that wouldn't jive with discordianism, after all..  because chaos can exist without the order that's already inherent in the world in which we already live and have to function.

anarchy is nice in theory, until you have to live in it.

Too busy to comment right now, but
Im not an anarchist, please don't suggest I am


didn't mean you.  sorry for the confusion.
Events in the past may be roughly divided into those which probably never happened and those which do not matter. --William Ralph Inge

"sometimes someone confesses a sin in order to take credit for it." -- John Von Neumann

Phox

  • Deserved It
  • ****
  • Posts: 7100
    • View Profile
Re: an argument for a deflationary policy in the You Ess of Heeeeey
« Reply #14 on: September 06, 2010, 08:38:23 pm »
didn't mean you.  sorry for the confusion.

If you are talking about me, I've stated elsewhere that I'm a Hobbesian.